MANITOBA HYDRO 2017/18 and 2018/19 GENERAL RATE
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1 MANITOBA PUBLIC UTILITIES BOARD Re: MANITOBA HYDRO 2017/18 and 2018/19 GENERAL RATE APPLICATION PRE-HEARING CONFERENCE Before Board Panel: Robert Gabor - Board Chairperson Marilyn Kapitany - Board Member Larry Ring - Board Member Shawn McCutcheon - Board Member Sharon McKay - Board Member Hugh Grant - Board Member HELD AT: Public Utilities Board 400, 330 Portage Avenue Winnipeg, Manitoba June 12, 2017 Pages 1 to 275 2 1 APPEARANCES 2 Bob Peters )Board Counsel 3 Dayna Steinfeld ) 4 5 Patti Ramage )Manitoba Hydro 6 Odette Fernandes ) 7 8 Byron Williams )CAC(Manitoba) & 9 Katrine Dilay )Winnipeg Harvest 10 11 William Gange )Green Action 12 Peter Miller )Centre 13 David Cordingley ) 14 15 Antoine Hacault )MIPUG 16 Patrick Bowman ) 17 18 George Orle )MKO 19 Michael Anderson ) 20 21 Corey Shefman )Assembly of 22 )Manitoba Chiefs 23 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 3 1 LIST OF APPEARANCES (cont'd) 2 James Battershill )Keystone 3 Alana Gray )Agricultural 4 )Producers 5 6 Kevin Williams )Business Council 7 Don Leitch )of Manitoba 8 Matt Nordlund (summer student) ) 9 10 Christian Monnin )General Service 11 Tom Thiessen )Small, General 12 Ron Koslowsky )Service Medium 13 Jill Knaggs )Customer Classes 14 15 Gerald Finkle ) Private citizen 16 John Gray ) Private citizen 17 18 19 20 21 22 23 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 4 1 TABLE OF CONTENTS 2 Page No. 3 4 Opening Comments by the Chairperson 6 5 Opening Comments by Board Counsel 15 6 7 Presentation by Manitoba Hydro 26 8 Question Period 44 9 Presentation by CAC(Manitoba) & Winnipeg Harvest 48 10 Question Period 63 11 Presentation by MIPUG 67 12 Question Period 76 13 Presentation by the Assembly of Chiefs 79 14 Presentation by Mr. Gerald Finkle 92 15 Presentation by Green Action Centre 96 16 Question Period 113 17 Presentation by Dr. John Gray 117 18 Presentation by General Service Small, General 19 Service Medium Customer Classes 120 20 Question Period 138 21 Presentation by Keystone Agricultural Producers 141 22 Presentation by Manitoba Keewatinowi 23 Okimakanak Inc. 157 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 5 1 TABLE OF CONTENTS (Con't) 2 Page No. 3 Presentation by Business Council of Manitoba 174 4 Question Period 182 5 6 Discussion Re: Issues List 192 7 Manitoba Hydro Comments on Intervenor Applications 230 8 Comments From the Intervenor Applicants 241 9 Discussion Re: Timetables 257 10 11 Certificate of Transcript 275 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 6 1 --- Upon commencing at 9:04 a.m. 2 3 OPENING COMMENTS BY THE CHAIRPERSON: 4 THE CHAIRPERSON: Morning, everyone. 5 Welcome to the Public Utilities Board pre-hearing 6 conference for Manitoba Hydro's 2017/'18 and 2018/'19 7 General Rate Application. 8 My name's Robert Gabor. I'm the 9 Chairman of the Public Utilities Board. This is my 10 first pre-hearing conference related to Manitoba 11 Hydro. 12 With me are Board members Marilyn 13 Kapitany, Larry Ring, Shawn McCutcheon, Sharon McKay, 14 and Hugh Grant. Brief bios of each Board member are 15 available on the Board's web page. Both Marilyn and 16 Hugh have prior experience for Manitoba Hydro's last 17 General Rate Application. As -- as well, Larry Ring 18 sat with Marilyn and Hugh on the Manitoba Hydro Cost 19 of Service Study Methodology Review. This is the 20 first General Rate Application for Sharon, Shawn, and 21 me. 22 The panel is assisted in this hearing 23 by associate secretary Kurt Simonsen, judicial hearing 24 assistant Diana Villegas. Bob Peters and Dayna 25 Steinfeld will act as Board counsel. They're sitting DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 7 1 there. 2 As in prior hearings, the Board is also 3 assisted by technical advisors from Ryall Engineering 4 and Cathcart advisors. The Board would like to 5 welcome Alex McQuarrie, who has recently joined 6 Cathcart Advisors. 7 I would also like to pause for a moment 8 to mention the passing of Larry Buhr earlier this 9 year. Larry was a long-time and valued engineering 10 advisor to the Board and he is missed by all of us at 11 the Board and our advisors. His absence will surely 12 be keenly felt by us all throughout this general rate 13 application process. 14 On behalf of the panel I would also 15 like to welcome Manitoba Hydro and the perspective 16 Intervenors. This pre-hearing conference is scheduled 17 for today with Wednesday available as an overflow day 18 if we need it. However, we are going to try and push 19 the matters through today, as there is a scheduling 20 conflict with a number of people. So if we can fit it 21 in today, and if it requires us to go late, we will do 22 so if we can complete it. 23 The Public Utilities Board's mandate is 24 to set just and reasonable rates that are in the 25 public interest. The public interest has been defined DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 8 1 by the Manitoba Court of Appeal as balancing the 2 impacts of rate increases on consumers with the fiscal 3 health of the Utility. 4 In order to set just and reasonable 5 rates that are in the public interest, the Board will 6 need to hear and consider all of the evidence that is 7 adduced on the record of this proceeding and hear 8 submissions from Manitoba Hydro and all approved 9 Intervenors. 10 On May 5th, 2017, Manitoba Hydro filed 11 its letter of application for its 2017/'18 and 12 2018/'19 general rate application. Manitoba Hydro 13 filed its revenue requirement materials on May 12th, 14 2017, and it's cost of service, and proposed rates, 15 and customer impact materials on May 26, 2017. 16 Also on May 26, 2017, Manitoba Hydro 17 provided its responses to minimum filing requirements 18 from the Board and passed the Intervenors of record, 19 excluding the Board's capital related minimum filing 20 requirements. The capital related responses are 21 expected on or around June 21st, 2017. 22 Both Manitoba Hydro and approved 23 Intervenors are to assist this panel in understanding 24 the issues and options that relate to Manitoba Hydro's 25 request to finalize the existing August 1st, 2016, DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 9 1 interim rate, as well as Manitoba Hydro's request for 2 an interim rate to increase consumer rates by 7.9 3 percent effective August 1st, 2017; to finalize that 4 August 1st, 2017, interim rate in the general rate 5 application, and to increase consumer rates by a 6 further 7.9 percent in 2018. 7 That leads me to the main purposes of 8 this pre-hearing conference, which are (a) to identify 9 and approve appropriate Intervenors, (b) to identify 10 which issues are included in the scope of this public 11 hearing, and (c) to finalize a timetable for the 12 orderly exchange of evidence and the conduct of the 13 public hearing. 14 At this time, the Board has received 15 written applications for Intervenor status from the 16 Consumers' Coalition, which is a coalition of the 17 Consumers' Association of Canada (Manitoba) and 18 Winnipeg Harvest; the Green Action Centre; Manitoba 19 Industrial Power Users Group; the general service -- 20 small general service medium customer class; Manitoba 21 Keewatinowi Okimakanak; the Assembly of Manitoba 22 Chiefs; Keystone Agricultural Producers, the Business 23 Council of Manitoba; and individuals Mr. Gerald Finkle 24 and Dr. John Gray. 25 While this pre-hearing conference needs DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 10 1 to be conducted in an orderly and efficient manner, 2 please remember that these proceedings are to be 3 informal, even if the technology makes it appear 4 otherwise. 5 The Board will hear from all proposed 6 Intervenors seeking to be involved in this hearing, 7 and we may have questions of you to help our 8 understanding of your requests for Intervenor 9 standing. 10 Please note today is not an evidentiary 11 hearing. Today is to deal with the process. 12 In a letter dated May 26, 2017, the 13 Board advanced questions for the proposed Intervenors 14 to address at today's pre-hearing conference. This 15 letter has been provided to all proposed Intervenors. 16 The Board requests that all proposed Intervenors 17 provide answers to the matters set out in the May 26 18 letter. 19 Before I call on Board counsel, the 20 panel has specific requests of the parties. The Board 21 welcomes public participation, and there are several - 22 - several ways for the public to participate and to 23 communicate with the Board. 24 At one (1) of -- end of the spectrum, 25 Intervenors representing a significant number of DIGI-TRAN INC. 1-800-663-4915 or 1-403-276-7611 Serving Clients Throughout Canada 11 1 ratepayers may be approved, and if so, are expective - 2 - expected to actively participate throughout the 3 hearing process, including reviewing Manitoba Hydro's 4 application, asking Information Requests to fully 5 understand the position of the Utility, perhaps file 6 expert evidence, attend the public hearing to cross- 7 examine witnesses of other parties, and to provode -- 8 to provide closing submissions.